Airlines Accelerate Web Sales and e-Ticketing

16th Oct 2003

Direct ticket sales through airline branded web-sites have doubled in the last 12 months to be worth approximately US$ 50 billion a year and account for around 10 per cent of total airline ticket sales, according to the results of the fifth annual Airline IT Trends Survey - conducted by SITA
and Airline Business magazine.
The survey shows that ticket sales through all web channels represent about 16 per cent of total sales, growing from 10 per cent last year and 6 per cent in 2001. Just 10 per cent of airlines, mainly low-cost carriers, are already selling the majority of their tickets online and traditional airlines aim to achieve this within the next two to three years.

Peter Buecking
, SITA President, said: “The lower costs of web-sales means that distribution will remain under the microscope as airlines transform their customer service model. The majority of airline tickets are still sold through travel agents supported by the global distribution systems (GDSs), but this dominance is being challenged. As traditional carriers aim to increase direct web-sales they will have to simplify their fares and pricing systems to make it easier for passengers to use their web-sites to purchase tickets - BA.com is a good example of what can be achieved. Travellers may also benefit as airlines are also looking to extend their provision of additional travel services, such as car hire, insurance and hotel rooms, and enhance both revenue opportunities and online customer service.”

Electronic ticketing (e-ticketing) continues to grow and now accounts for nearly 15 per cent of ticket sales, compared to 11 per cent last year and 9 per cent in 2001. The carriers of North America lead the world, selling almost 40 per cent of tickets through a variety of online channels and almost 60 per cent of their total sales are now e-tickets.

The most important issue with web sales was considered to be ‘not enough buyers online’ by 21 per cent of airlines, followed by the complexity of airline pricing/fare models (17 per cent) and then security (14 per cent).

The survey reveals that airline branded web-sites for corporate client sales will more than double within the next couple of years and that over half of airline web-sites now offer schedule information and frequent flyer services. Around 25-30 per cent of carriers already provide hotel bookings, package holidays, car hire and corporate client services, but many more plan to offer these services via their own web-sites in the next few years.